Peers vs Crowds

Language matters. It frames our expectations and can limit or expand our thinking. I’ve written before about my preference for the term “peerfunding” over “crowdfunding”. More recently I’ve begun to see a spectrum of activities which can be more crowd or peer-focused, making both terms relevant but the distinction important.

To me, crowdsourcing is a competitive process – the crowd is either helping select amongst alternatives or competing to win an award. As an example, GeniusRocket is a design crowdsourcing site – their community competes via the submission of ideas and proposals, to have their work selected and be paid by GeniusRocket’s clients.

The Pepsi Refresh Project is another example of the crowd in action. The crowd is helping Pepsi select where to invest its philanthropic dollars. It’s crowdsourcing because it’s a large mass of people who have little-to-no contact with each other making submissions, in the form of votes here and designs with GeniusRocket, to the organizer of the contest.

What Creating the Future is doing, on the other hand, is peersourcing. They have invited their community to co-create the criteria and process of the scholarship fund they recently raised funds for on StartSomeGood.

In this instance the participants are not an anonymous “crowd” and they are not competing with each other. Instead they are co-creating something together. They are peers, colleagues, collaborators. Whilst the number of responses isn’t large the quality of thinking behind the responses makes them enormously valuable.

If we simply refer to Pepsi Refresh, GeniusRocket and what Creating The Future are doing as “crowdsourcing” I think we are missing a key differentiator between them. I am loath to create more jargon but I fear that calling collaborative efforts like Creating The Future, or the way Beth Kanter aggregates contributions and best practices through wiki’s, Facebook and her blog crowdsourcing is to miss the most important aspect of these approaches: that they build a community of peers and invite co-creation, rather than setting up the “crowd” to compete for the organizers favor.

I believe what we and our ventures do at StartSomeGood is peerfunding rather than crowdfunding. On StartSomeGood, as with other fundraising platforms for entrepreneurs and creatives, the majority of the funding comes from the fundraisers existing community. Supporters feel an affiliation for the project and affection for the organizer, or connect to the cause via a shared identity or experience. These funders are not a crowd, they are peers, and they will be your most important asset in creating change.

I’m thrilled to see a project which was successfully peerfunded on StartSomeGood now move on to peersourcing the details of how the scholarship will work. Check out their thinking so far and feel free to contribute!

Breaking down the walls which stand in the way of changemakers

This is a guest post I wrote for the Case Foundation blog and was published on the day of the StartSomeGood launch (in their offices):

Clay Shirky is fond of saying that when it comes to online communications “more is different.” Similarly, when it comes to philanthropy, less is different.

The last half-decade has given rise to many incredibly exciting advances in the area of online giving and community building. Causes has allowed us to give to organizations right from inside Facebook. Razoo, First Giving, Citizen Effect and the like made it possible to create personal fundraising campaigns for causes we care about. Kiva made microfinance something we could all participate in, and Global Giving connects us to development projects around the world.

These platforms, along with similar trends in political giving most famously leveraged by the Obama for President campaign, have created an explosion of a new type of philanthropy: mircro-philanthropy. But we will never fully realize the transformational potential of both the new technologies and behaviors behind micro-philanthropy if it continues to be locked up in walled gardens with only American 501c3 organizations given access.

My colleagues and I at StartSomeGood.com are changing this dynamic. We believe that the “nonprofit sector” is less important than the “social good sector”, that great world-changing ideas can come from anywhere and that socially-minded for-profits can be as effective at bringing about change as traditional non-profits.

We know that important work is being done by unincorporated groups and social change freeagents. We want to break down the silos that say only a specific type of incorporated institution in one country on earth is given access to sophisticated online fundraising tools. We want to dispel the myth that tax-deductability is an important driver of giving behavior because, truth be told, below a certain threshold it simply isn’t.

What are important drivers of giving behavior? Great stories, inspiring visions for a better world, a personal connection to an issue and relationships with people affected or involved are just some of the elements we know inspire people to contribute to a social good initiative. These elements are powerful, irrespective of tax status. More important, by far, are the ideas, inspiration and credibility of the entrepreneur doing the asking.

There is no shortage of challenges confronting our communities and our world, but within each obstacle lies an opportunity. An opportunity to rise up to meet those challenges head on, fostering new changemakers and more resilient communities in the process. We do not have an ideas shortage. Rather, we face an implementation shortage, caused in part by the walls we have built around the fundraising process - defining too narrowly where these opportunities should originate and why people would choose to support them. These walls have led to less change, less opportunity and less difference.

StartSomeGood.com is breaking down these walls, and I hope you will join us.

Photo by JMC Photos on flickr, made available on a creative commons license.